BILL ANALYSIS
SENATE COMMITTEE ON VETERANS AFFAIRS
BILL MORROW, CHAIRMAN
Bill No: AB 1036
Author: Mullin
Version: As Introduced February 20, 2003
Hearing Date: July 8, 2003
Fiscal: YES
Consultant: David Grafft
SUBJECT OF BILL : CAL-VET HOME LOANS FOR VETERANS
EXISTING LAW AND BACKGROUND :
Existing law:
1. Authorizes the California Department of Veterans
Affairs to assist qualified veterans in purchasing farms
and homes, including mobilehomes.
2. Limits the amount that the Department can expend under
the Cal-Vet program in assisting veterans acquire different
types of homes and farms. Under current law the Department
cannot loan more than $70,000 for a mobilehome that is
located in a mobilehome park, and no more than $300,000 for
a farm.
3. Provides for the Veterans' Farm and Home Building Fund
of 1943 and authorizes the Department to expend money from
the Fund for purposes, among others, of advancing to a
Cal-Vet purchaser money to make alterations, repairs, or
improvements on their principal place of residence.
4. Existing state regulations allow a Cal-Vet purchaser to
borrow against purchaser's equity in a farm or home if the
Department's interest in the property is prior and senior
to any other financing on that farm or home.
PROPOSED LAW :
This measure would:
1. Adjust the Cal-Vet expenditure limit for mobilehomes
located in a mobilehome park to $125,000 and for farms to
150% of the maximum Fannie Mae loan limit for single family
homes.
2. Authorize the Department to provide more flexibility in
financing Cal-Vet home alterations, repairs and
improvements.
COMMENT :
1. This measure passed the Assembly Veterans Committee
14/0; the Assembly Appropriations Committee 24/0; and the
Assembly Floor 77/0.
2. This measure is sponsored by the California Department
of Veterans Affairs to amend the Military and Veterans Code
to increase the amount of a Cal-Vet loan for mobilehomes
located in a mobilehome park and for the purchase of a
farm, and to ease the rules for financing Cal-Vet home
improvements.
3. The maximum amount that the Department can loan to a
qualified veteran for a home, farm, or mobilehome is set by
legislation and can only be changed by legislative action.
4. The current maximum loan amount for a home is
$322,700; for a farm $300,000, and for a mobilehome sited
in a mobilehome park $70,000. The maximum amount for a
home is keyed to the Fannie Mae index, which is updated
regularly. Until the passage of SB 1893 (Chapter 473,
Statutes of 2002) last year the maximum home loan amount
was set at $250,000.
5. Basically, the Department indicates that because of
rising land and home prices across California there is a
need to increases the maximum loan amounts for farms from
the current $300,000 to $484,050, which represents 150% of
the current Fannie Mae home purchase price for a single
family home.
6. By the same reasoning, the Department notes the
increase in the price of mobilehomes and proposes to
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increase the maximum Cal-Vet home loan amount for
mobilehomes sited in mobilehome parks from the present
$70,000 to $125,000.
SUPPORT : American Federation of State, County, and
Municipal Employees; California Department of Veterans
Affairs (Sponsor).
OPPOSE : None Received.
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